Daura Gold options Cerro Bayo, La Flora projects

Executive Summary

• Daura Gold Corp. has entered into a binding letter agreement with Latin Metals Inc. to earn up to an 80% interest in the high-grade Cerro Bayo and La Flora gold-silver projects located in the Deseado massif, Santa Cruz province, Argentina.
• The transaction grants Daura the option to acquire a 75% interest (with a top-up right to 80%) by making cash payments, assuming existing royalties, completing specific exploration work commitments, and delivering a NI 43-101 technical report with a mineral resource estimate.
• The projects are drill-ready with 21 permitted pads following EIA approval in early 2025, featuring high-grade surface samples and defined structural corridors consistent with prolific regional epithermal systems.

Key Details

• Transaction Structure: Binding letter agreement granting Daura the right to earn up to an 80% undivided interest in Cerro Bayo and La Flora.
• Earn-In Requirements (for 75% interest):
  • Aggregate cash payments of $1.7 million (USD) to Latin Metals.
  • Assumption of payments totaling $400,000 (USD) to the underlying vendor (Tres Cerros Exploraciones S.R.L.).
  • Completion of exploration work commitments.
  • Delivery of a NI 43-101F1 technical report containing a mineral resource estimate.
• Work Commitments:
  • Irrevocable commitments due on or before April 30, 2026: 50 line km of IP profiling, 150 line km of gradient array IP, and 1,500 meters of drilling.
  • Total drilling requirement prior to option exercise: 28,000 meters.
• Top-Up Right (to 80% interest):
  • Available concurrently with the exercise of the initial option.
  • Cash consideration based on mineral resources: $7 USD per gold equivalent ounce of measured and indicated resources; $5 USD per gold equivalent ounce of inferred resources.
• Royalty Assumptions:
  • Underlying vendor retains a 0.75% Net Smelter Return (NSR) royalty.
  • Daura assumes the right to repurchase 0.5% of this NSR royalty from the underlying vendor for $1 million (USD).
• Joint Venture Terms:
  • Initial split: 75% Daura / 25% Latin Metals (or 80/20 if top-up is exercised).
  • Dilution clause: If either party’s interest falls below 10%, it converts to a 2% NSR royalty (half of which can be purchased by the other party for $5 million USD until three months after a production decision).
• Latin Metals Exit Option:
  • Within 90 days after the top-up right expiry, Latin Metals may elect to convert its JV interest into a 3.0% NSR royalty, leaving Daura with 100% interest.
  • Daura retains the right to purchase 33.33% of this converted royalty (reducing it to 2.0%) for $5 million USD until three months after a production decision.
• Project Technical Highlights:
  • Location: Deseado massif, Argentina (prolific district yielding >600M oz Ag and >20M oz Au since 1990).
  • Targets: Nine high-priority drill target areas identified via geochemistry, mapping, IP, and magnetics.
  • Surface Sampling: La Flora returned up to 71 g/t Au and 150 g/t Ag; Cerro Bayo returned up to 82 g/t Au and 1,239 g/t Ag.
  • Status: Drill-ready with 21 fully permitted drill pads; EIA approved in early 2025.
  • Infrastructure: Year-round access and strong local infrastructure.

Notable Quotes

• "As Daura continues to advance its flagship Antonella project in Peru, this agreement provides the company with excellent optionality on a high-quality, drill-ready target in the Deseado massif, which is one of the world's most prolific gold and silver districts. This agreement directly aligns with Daura's strategy of targeting and advancing high-grade epithermal gold and silver systems in proven mineral belts, complementing the company's exciting projects in Peru." — Mark Sumner, President of Daura Gold